Excelsior Reports Results for Second Quarter 2007 and Provides an Operations Update

The Company is continuing to focus efforts in oil sands exploration and appraisal in the Hangingstone ("Hangingstone" or "Hangingstone Asset"), and West Surmont ("Surmont" or "Surmont Asset") areas near Fort McMurray, Alberta.

Highlights

During the quarter ended June 30, 2007 Excelsior:

- Completed the acquisition, processing and interpretation of 134 kilometers of high quality 2D seismic data at Hangingstone. The data identified several areas of thick McMurray Formation which contains the bitumen saturated sands.

- Surveyed and permitted 50 well locations at Hangingstone to support the 24 well program to commence in Q4 2007.

- Executed a Letter of Intent to acquire an additional 22.5% working interest in the Hanginstone Property. This transaction closed on July 13, 2007.

- Closed a $35 million financing which was significantly oversubscribed.

- Received reports from DeGolyer and MacNaughton Canada Limited which assigned 40 million barrels of probable and possible reserves and 130 million barrels best estimate contingent resources to 16 sections of the Hangingstone Asset.

- Strengthened the Management team with the appointment of an experienced Chief Financial Officer.

Excelsior ended the quarter with:

- Cash and cash equivalents of $30,362,298 and working capital of $30,320,324. The Company's cash is held in accounts on deposit and short term guaranteed investment certificates issued by a major Canadian bank.

3Q-4Q Activities and Outlook

- Executed a Farmin Agreement to earn a 75% working interest in 18 contiguous sections at the West Surmont property, located in the Athabasca oil sands area near Fort McMurray, Alberta.

- Commenced seismic operations at Surmont to acquire 72.5 kilometers of 2D seismic data which are anticipated to be completed in mid to late September.

- Executed a drilling management contract and secured a core drilling rig to drill the 24 well program at Hangingstone. The drilling program is anticipated to commence in November 2007.

Commenting on the previous quarter and forward outlook, David Winter, President and Chief Executive Officer said: "We are very pleased with the progress we have made over the last quarter, in particular the results of the 2D seismic at Hangingstone confirming thick McMurray Formation across the property, which is very exciting. We look forward to starting our drilling program there in November. Our financing was well received by the market and greatly oversubscribed which I think underscores the quality of the assets. Adding the Surmont interests to our asset base diversifies risk and further enhances company value. Being able to acquire seismic at Surmont in September will allow us to accelerate our exploration program for this interest and permit us to recognize part of the resource value we associate with this interest there."

Operations Update

The Company completed the interpretation of high quality 2D seismic data at its Hangingstone property in the second quarter of 2007. The data identified several areas of thick McMurray Formation which contains the bitumen saturated sands. Based on the interpretation the Company has permitted and licensed 50 well locations. This gives the Company a great deal of flexibility to change the program or add to the 24 well drilling program depending on the results of the initial wells. Excelsior has contracted a drilling management contractor and a core drilling rig which will commence the drilling program in November 2007.

In April, Excelsior executed a letter of intent to acquire up to an additional 22.5% working interest in its Hangingstone Asset. This transaction closed on July 13, 2007 for the additional 22.5% working interest, providing Excelsior an option to earn 75% working interest in 39 contiguous sections of land upon completion of its farm-in obligations.

Excelsior obtained an independent evaluation of bitumen reserves and resources on the Hangingstone property. The reserve estimates were prepared by DeGolyer and MacNaughton Canada Limited in a report with an effective date of April 30, 2007, details of which were previously disclosed in a news release dated May 17, 2007.

Excelsior completed a private placement for gross proceeds of $35,001,250 on June 25, 2007 to fund the oil sands activity at Hangingstone and certain land acquisition costs at Surmont. The private placement comprised of 31,765,000 units issued at a subscription price of $0.85 per unit and 7,620,000 common shares issued on a flow-through basis at a price of $1.05 per flow-through share. Each unit is comprised of one common share in the capital of the Company and one common share purchase warrant (a "Warrant") of the Company, with each Warrant entitling the holder thereof to acquire an additional 0.05 common share at no additional cost should the common shares of the Company not be listed and posted for trading on the TSX Venture Exchange on or before the expiration of 120 days from the closing of the private placement, being October 23, 2007.

In July, 2007 the Company signed a farm-in agreement to acquire a 75% working interest in 18 contiguous sections of land in the West Surmont area south of Fort McMurray. Excelsior is acquiring its interest by paying 100% of land acquisition costs and future seismic and drilling costs totalling $20,683,803, and a cash bonus of $2,300,000 to earn its 75% interest. Excelsior paid $11,833,803 in land costs on July 31, 2007. The cash bonus will be paid upon completion of the seismic program. The Company has also agreed to pay a supplemental payment of up to $2,900,000 which is contingent upon successful drilling results and the parties' agreement to continue operations. This obligation will be satisfied by funding the farmor's 25% share of continuing operations.

At Surmont, the Company has commenced the acquisition of 72.5 kilometres of 2D seismic data using a helicopter supported acquisition team. Although the cost of helicopter supported seismic is more expensive than conventional land based seismic acquisition, it will allow the Company to accelerate an exploration core drilling program at Surmont. Pending successful results of the seismic program the Company could drill up to 18 wells in the 2007/2008 winter drilling season rather than deferring the core drilling into the 2008/2009 winter drilling season, and hence gain 12 months in any subsequent pilot-project planning.

The following information is selected highlights of the results of operations for Excelsior for the three and six months ended June 30, 2007 and 2006 and should be read in conjunction with the management discussion and analysis and unaudited interim consolidated financial statements for the three and six months ended June 30, 2007, available on line at www.sedar.com.

Selected Information
----------------------------------------------------------------------------
                    Six Months     Six Months   Three Months   Three Months
                         Ended          Ended          Ended          Ended
                 June 30, 2007  June 30, 2006   June 30,2007  June 30, 2006
                                    (restated)                    (restated)
----------------------------------------------------------------------------
Gas revenue        $    59,820    $    60,864    $    27,866    $    41,589
----------------------------------------------------------------------------
General and
 administrative
 expense               495,227        404,733        258,786        178,806
----------------------------------------------------------------------------
Net and
 comprehensive
 loss                 (623,710)      (419,068)      (319,607)       (95,936)
----------------------------------------------------------------------------
Loss/share              ($0.01)        ($0.01)        ($0.01)             -
----------------------------------------------------------------------------
Cash flows used
 in continuing
 operations        $  (567,916)   $  (539,129)   $  (349,523)   $  (221,044)
----------------------------------------------------------------------------
Weighted average
 number of shares 
 outstanding        34,699,258     38,582,936     41,110,964     39,516,137
----------------------------------------------------------------------------


Net Revenue
----------------------------------------------------------------------------
                    Six Months     Six Months   Three Months   Three Months
                         Ended          Ended          Ended          Ended
                 June 30, 2007  June 30, 2006   June 30,2007  June 30, 2006
                                    (restated)                    (restated)
----------------------------------------------------------------------------
Gas revenue        $    59,820    $    60,864    $    27,866    $    41,589
----------------------------------------------------------------------------
Royalties              (13,936)       (39,259)        (4,877)       (17,684)
----------------------------------------------------------------------------
Operating costs         (8,265)       (10,534)        (6,437)        (8,895)
----------------------------------------------------------------------------
Net revenue             37,619         11,071         16,552         15,010
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Excelsior, through its predecessor Qeva, acquired a 26.64% working interest in a petroleum and natural gas lease located in the Hastings area of Alberta in 2005. The property contains one natural gas well producing approximately 46 mcfd (net to Excelsior) for the 6 month period ended June 30, 2007 (2006 - 82 mcfd) at an average price of $7.11 per mcf (2006 - $4.09 per mcf). Crown royalties of $13,936 averaged 23% of revenue (2006 - 64%). Operating costs of $8,265 averaged $0.98 per mcf (2006 - $0.71 per mcf). Depletion for the Hastings property was calculated at a rate of $3.11 per mcf in 2007 totalling $26,200 (2006 - $3.58 per mcf, totalling $53,321).

For the three months ended June 30, 2007 the Hastings gas well produced approximately 41 mcfd (2006 - 91 mcfd) at an average price of $7.43 per mcf (2006 - $5.02 per mcf). Crown royalties of $4,877 averaged 18% of revenue (2006 - 42%). Operating costs of $6,437 averaged $1.78 per mcf (2006 - $1.07 per mcf). Depletion for the Hastings property was calculated at a rate of $3.11 per mcf in the three months ended June 30, 2007 totalling $11,700 (2006 - $3.24 per mcf, totalling $26,846).

General and Administrative Expenses
----------------------------------------------------------------------------
                    Six Months     Six Months   Three Months   Three Months
                         Ended          Ended          Ended          Ended
                 June 30, 2007  June 30, 2006  June 30, 2007  June 30, 2006
                                    (restated)                    (restated)
----------------------------------------------------------------------------
General and
 Administrative
 Expenses          $   495,227    $   404,733    $   258,786    $   178,806
----------------------------------------------------------------------------

General and administrative expenses were $495,227 for the six month period ended June 30, 2007 compared to $404,733 in 2006. The higher expenses in 2007 are due to costs associated with engaging third party engineers to prepare a reserve report for the Hangingstone property and an increase in legal and audit fees associated with administration of a public company. In 2007 the Company incurred costs to engage its external auditors to review the interim period financial statements.

General and administrative expenses were $258,786 for the three month period ended June 30, 2007 compared to $178,806 in 2006 with the increase being associated with costs for the Hangingstone reserve report and increased legal and audit fees associated with the administration of a public company.

Capital expenditures
----------------------------------------------------------------------------
                    Six Months     Six Months   Three Months   Three Months
                         Ended          Ended          Ended          Ended
                 June 30, 2007  June 30, 2006  June 30, 2007  June 30, 2006
                                    (restated)                    (restated)
----------------------------------------------------------------------------
Petroleum and
 natural gas   
 properties -
 cash additions    $ 8,954,619    $   151,457    $ 6,565,998    $   209,822
----------------------------------------------------------------------------
Petroleum and
 natural gas
 properties -
 non-cash
 additions           8,314,095         55,000      8,314,095              -
----------------------------------------------------------------------------
Total capital
 expenditures      $17,268,714    $   206,457    $14,880,093    $   209,822
----------------------------------------------------------------------------

Petroleum and natural gas property additions were $17,268,714 in the six months ended June 30, 2007 from $206,457 for 2006. Significant expenditures were incurred in 2007 to acquire the Hangingstone Asset. Excelsior paid initial costs for land and bonus of $1,400,000 and issued 2,333,333 common shares valued at fair market value of $956,667 upon signing the farm-in agreement in February, 2007. A seismic program for $1,432,375 was completed in the spring of 2007. In June, 2007 the Company elected to increase their working interest to 75% paying a further $6,054,300 cash for land and a bonus of $6,945,429 paid by issuing 6,314,026 common shares of Excelsior at a fair value of $1.10 per share. An additional 500,000 common shares were issued representing a finders fee for the Hangingstone Asset at a value of $412,000. Costs in 2006 were primarily incurred at Hastings, including the issuance of 157,142 common shares for a finders fee on the Hastings property valued at $55,000, and costs incurred in the North Sea.

Expenditures of $14,880,093 in the three month period ended June 30, 2007 were for $6,054,300 cash for land and $956,667 bonus paid by issuing 2,333,333 common shares, a bonus of $ $6,945,429 paid by issuing 6,314,026 common shares of Excelsior at a fair value of $1.10 per share and 500,000 common shares valued at $412,000 as a finders fee all for the Hangingstone Asset. Capital expenditures for the three month period ended June 30, 2006 are for the Hastings property and costs incurred in the North Sea.

Forward-Looking Statements: This news release contains statements about future events that are forward looking in nature and, as a result, are subject to certain risks and uncertainties such as changes in plans or the occurrence of unexpected events. Actual results may differ from the estimates provided by management. Readers are cautioned not to place undue reliance on these statements.

Email: m.kennedy@excelsior-energy.com